Correlation Between Great Ajax and Ladenburg Thalmann
Can any of the company-specific risk be diversified away by investing in both Great Ajax and Ladenburg Thalmann at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Great Ajax and Ladenburg Thalmann into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great Ajax Corp and Ladenburg Thalmann Financial, you can compare the effects of market volatilities on Great Ajax and Ladenburg Thalmann and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Great Ajax with a short position of Ladenburg Thalmann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Ajax and Ladenburg Thalmann.
Diversification Opportunities for Great Ajax and Ladenburg Thalmann
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Great and Ladenburg is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Great Ajax Corp and Ladenburg Thalmann Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladenburg Thalmann and Great Ajax is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Great Ajax Corp are associated (or correlated) with Ladenburg Thalmann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladenburg Thalmann has no effect on the direction of Great Ajax i.e., Great Ajax and Ladenburg Thalmann go up and down completely randomly.
Pair Corralation between Great Ajax and Ladenburg Thalmann
If you would invest 1,710 in Ladenburg Thalmann Financial on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Ladenburg Thalmann Financial or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great Ajax Corp vs. Ladenburg Thalmann Financial
Performance |
| Timeline |
| Great Ajax Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ladenburg Thalmann |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Great Ajax and Ladenburg Thalmann Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Ajax and Ladenburg Thalmann
The main advantage of trading using opposite Great Ajax and Ladenburg Thalmann positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Ajax position performs unexpectedly, Ladenburg Thalmann can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ladenburg Thalmann will offset losses from the drop in Ladenburg Thalmann's long position.| Great Ajax vs. Eagle Point Credit | Great Ajax vs. Argo Group 65 | Great Ajax vs. DTE Energy Co | Great Ajax vs. Entergy Arkansas LLC |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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